Movie Downloads Cometh--or Not?

Posted by: Cliff Edwards on April 03, 2006

Slowly, oh so slowly, major Hollywood players seem to be warming to the idea of digital downloads.

Universal, Warner Bros., Sony Pictures, Paramount and Twentieth-Century Fox are finally allowing consumers to download and own a copy of major film releases, through their Movielink service And CinemaNow, a staple of Windows Media Center pcs, has struck a similar agreement with Sony and Lionsgate.

Problem is, consumers once again seem to be taking a back seat to the corporate bottom line. New releases on Movielink are expected to run between $20 and $30, according to news reports, and you’ll be stuck watching them only on computers, since the DVDs you are allowed to burn do not work in standalone players.

One wonders whether many consumers will be attracted to paying as much as twice the price for a movie that they can get in the local Best Buy or Wal-Mart on the very same day without having to wait for at least an hour to download (using a very fast broadband connection). And at least the physical media will play in just about any DVD player.

Seems to me that with all the dough studios will save from not having to deal with physical media and returns—$6 to $8 by some studio execs count—the greed factor shouldn’t be quite so high. I’m all for convenience, but not when I feel like someone is picking my pocket while pretending to give it to me.

TrackBack URL for this entry: http://blogs.businessweek.com/mt/mt-tb.cgi/

Reader Comments

PXLated

April 3, 2006 04:03 PM

They are absolutely clueless!

MikeS

April 3, 2006 07:25 PM

Outrageous! Fortuneately, I think the consumer will help make this one a big snoozer. Hollywood needs to wake up and realize the consumer is still King.

Ken Leebow

April 4, 2006 07:54 AM

As we move toward HDTV and Media PCs, offering such an antiquated service is beyond silly.

Theodore

April 4, 2006 10:51 AM

I totally agree with you..it is outrageous. The business model will fail big time. They can make so much money if they just alter their business models, maybe as much twice the amount they are making today.

Goyo de la Brisa

April 14, 2006 07:17 PM

Have you considered the business effect of this new distribution system will have on the movie industry?

As an independent filmmaker I have been pondering this, because it is transformational.

I have been in contact with Google and am eagerly awaiting the moment when they get the pay-for-view system scaled and reliable so I can add my movies to their offerings.

When a new distribution system starts up the value of experience drops and opportunity falls equally - for the short learning period - then new experience is acquired and once again experience pays.

At this time we are facing a transformation which for that window will allow a few new producers of entertainment to break into the big time by exploiting this distribution system and understanding it faster and deeper than the major studios.

The majors have the advantage of money, but the disadvantage of established business models which they don't want to disturb.

As an independent I may be willing to sell at $1 for a feature length movie because I don't have to pay Bruce Wills $5M, but maybe I will give away the film on-line so I can sell the TV rights only.

Maybe there is a new strategy that no one yet knows.

Interesting, no?

http://godscompanion.blogspot.com uses the blgosphere to promote the film and will be using google to distribute it. Could be the start of something big.

Post a comment

Name

Email

Comment

About

BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.